Economics and Risk Management - 2025 entry

This module introduces the fundamentals of project management and mining economics, including project evaluation and economic decision-making techniques.

Principals of project management are introduced, giving you the ability to use standard management tools and the context in which they are applied. The focus is on the management of large, multi-disciplined construction projects, examining the various components and inputs to successful project development.

The mineral economics section of the module examines supply and demand drivers in the metal, bulk commodity and energy mineral sectors and illustrates key cost inputs and productivity issues. The financial appraisal of mines and the economic and risk analysis of project alternatives are considered; together with an overview of broader mining business risks.    

This module aims to allow you to master skills and attain thorough knowledge and understanding of project management techniques including appropriate systems-based tools. Furthermore, you will get the chance to develop your understanding of the way people work as a route to effective management. In addition, the module emphasises the value of experience, whilst ensuring you understand the concepts that underlie successful project management.

This module aims to provide you with a broad understanding both the macro-economic and the industry specific economic and business risk environments in which mines and projects operate and are evaluated. It introduces you to financial analysis and explores how technical and operational parameters influence the revenue stream and cost structure at mines.

Finally, we will examine the application of economic analysis techniques within spreadsheet software with specific reference to case studies and scenarios considering engineering alternatives.

On successful completion of this module you should be familiar with these Knowledge and Skills as specified in the Mine Management Apprenticeship Standard (ST1309):

K12: The influence and requirements of legislation on the principles of risk management and the methods that are used to deal with major and occupational hazards, operational, safety, health, financial and environmental risks.

K16: The different stages of projects including the principles of planning, scheduling, and sequencing to ensure effective life of mine plans. The ways of managing, influencing, and controlling outcomes through the application of project management techniques

K21: Financial and economic strategies, including budgets, financial management and accounting. The influence of commodity prices, feasibility studies, financial reports incorporating cash flow, capital, profit and loss

K22: Approaches to costing and procurement, contracting, sales, marketing, and the route to market including consideration of any legal requirements.

K23: Communication techniques, including written, verbal, non-verbal and digital and different types of interpersonal skills including questioning and listening

K25: Approaches to stakeholder, customer, and supplier management.

K26: Time management, how to set SMART targets, prioritise activities and undertake forward planning in a business environment

K27: Data analysis techniques used to examine complex and interactive issues, to assist in developing appropriate solutions solving and support the decision-making process

S6: Use project management and planning techniques. Allocate resource requirements. Monitor progress towards project goals and identify corrective action

S11: Manage and adapt budgets and control expenditure. Review and produce financial reports that provide analysis and draw conclusions on financial risk and evaluation of short and long term mine strategies.

S18: Plan and manage own time.

S19: Use evidence-based tools, qualitative and quantitative analysis techniques to demonstrate an ethical approach to problem solving and making decisions that improve the safety, operational and environmental performance of the underground operation

On successful completion of this module you should be able to:

Module Specific Skills and Knowledge

Discipline Specific Skills and Knowledge

Personal and Key Transferable / Employment Skills and Knowledge

Syallabus is taught initially in two strands, project management and mineral economics, before bringing these topics together to discuss financial analysis and risk management.

Project Management

• Project definition, scope of work and budget, planning and control activity;
• Project evaluation, decision-making, project monitoring and reporting, project risk;
• Technical risk, contractual/commercial risk;
• Project activity, cost control, progress reporting, quality control and logistics;
• Contract management;
• Project finance and feasibility assessment.

Mineral Economics

Industry fundamentals and macro-economic environment. The effects of supply and demand in mineral markets and key price drivers that affect mineral commodity prices. Development of price forecasts and metal market studies. Introduction to capital expenditure, operating costs and unit/cash cost curves. Role of cash flow modelling and financial analysis evaluation of mining projects and operations. Coverage of the main components of such analysis and of risk/sensitivity analysis. Main technical and engineering factors to be considered in project evaluation and the most common sources of business risk in the mining industry.

All passed components of the module will be rolled forward and will not be reassessed in the event of module failure.

Basic reading:

• Lock, Dennis Project Management 9th Edition Gower Publishing Limited
• Barker, R Short Introduction to Accounting (Euro Edition) Cambridge University Press
• Rudenno, V. Mining Valuation Handbook - Mining and Energy Valuation for Investors and Management 3rd Edition John Wiley & Sons

Reading list for this module: